The prepaid credit card market - Italy

The global prepaid card market has grown significantly since 2020, with the post-COVID-19 economic landscape propelling its value to $1.9 trillion by 2022. Projections indicate that this market could reach $4.1 trillion by 2030. In Italy, the preference for digital and contactless payments has increased, particularly for prepaid cards, whose transaction volume and value have risen. The Italian prepaid card market in particular is remarkable, accounting for 9% of e-commerce transaction value and 12% of point-of-sale spending in 2022, with usage expanding across various segments, including e-commerce, where it occupies a significant share of the market.

Despite a general decline in consumption during the pandemic, Italy saw growth in innovative payments, with an increase in contactless payments via cards and smartphones. Prepaid cards were the only segment to record growth in transaction value in the first half of 2020, with an increase of 13.3%. The outlook for the sector remains positive, with forecasts of sustained growth due to increased consumer demand for secure payment methods amid growing concerns about data security...

Italy's prepaid card market expands amid growth in digital payments

Italy has recently witnessed a significant trend in the credit card market, with a particular affinity for prepaid cards. The reason for this is that prepaid cards offer a secure and controlled spending mechanism, particularly pronounced in online transactions.this is particularly true of online transactions, where security concerns are paramount. As the market diversifies and regulations become stricter, supply is adapting to meet ever-increasing demand, reshaping the future landscape of prepaid payment solutions in the country. Looking at the figures, we can see a significant increase in the number of transactions carried out using prepaid cards, which jumped by around 35% to a transaction value of between 50 and 60 billion euros, representing growth of around 25-30% on the previous year. The Italian market, which is riding the wave of e-commerce development, is also part of a global trend in which digital wallets have seen significant growth. The share of prepaid cards in e-commerce transactions is particularly significant in Italy, where it is the highest among the various markets, representing around 7-11%. The popularity of prepaid cards is not limited to e-commerce. In physical retail outlets, prepaid card use is significant, accounting for around 10-14% of spending. The Italian prepaid card market is particularly robust, with usage percentages that eclipse many other global markets.

In terms of overall payment method preferences, cash still holds a notable share of the POS market, accounting for around 25-30%, while a shift in payment from cash to cards is evident. Digital wallets are gaining ground, both online and in POS, reflecting changing consumer payment preferences. During the pandemic, the trend towards digital and contactless payments strengthened, resulting from a change in behavior aimed at minimizing physical contact. This trend resulted in an astonishing 80% increase in smartphone payments and a solid performance by prepaid cards, whose transaction value rose by over 10%. Looking ahead, the prepaid card segment is set for positive growth. It is expected to grow at a compound annual growth rate (CAGR) of around 8-10%, driven by increased awareness of expense management and privacy concerns, against a backdrop of growing cyber threats. Regulatory frameworks at EU and national level, such as Directives 2000/28/EC and 2000/46/EC and subsequent national transpositions, support this market dynamic, ensuring that issuers are held accountable.

Key players in the Italian prepaid card market The Italian prepaid card market is thriving, and is home to a variety of pivotal institutions and companies that shape its dynamics. Below, we present an overview of the main players, each making a unique contribution to the prepaid card ecosystem.

• Postepay S.p.A. (Poste Italiane) Postepay, a subsidiary of the renowned Poste Italiane - a name synonymous with trust and tradition - occupies a prime position in the prepaid card sector in Italy. It caters to a broad customer base, offering a range of prepaid card services that combine the accessibility of electronic money with the extensive reach of the Italian postal system. Thanks to its extensive network and customer-focused approach, Postepay is playing a fundamental role in the popularization of prepaid cards in Italy.
• Mediolanum Bank One of Italy's leading banking entities, Mediolanum Bank offers a range of financial services, including the provision of prepaid cards. It stands out for its innovative banking solutions designed to meet the growing demand for flexibility and security in digital transactions. Mediolanum is known for its commitment to customer service and its dynamic approach to banking in the age of technology.
• illimity Bank A modern, agile player in the financial sector, illimity Bank is making its mark in the prepaid card market. Known for its cutting-edge financial solutions, the bank caters to both individuals and businesses, bringing a level of innovation and sophistication that resonates with digitally-savvy customers.
• HYPE S.p.A. HYPE S.p.A., which brings a fresh perspective to the prepaid card sector, is a shining example of a fintech company. HYPE's services are linked to modernity and convenience, aiming to simplify and enhance the user's financial experience with innovative applications.s financial experience with user-friendly applications and cutting-edge prepaid products that meet the demand for a modern, mobile and secure way to manage money.
• Mooney S.p.A. Mooney is another important emerging Fintech that has made inroads into the prepaid card sector. It stands out for its mission to offer convenient, accessible and reliable prepaid card services, particularly to customers who may not be fully served by traditional banking institutions.
• Visa and Mastercard No discussion of the prepaid card market is complete without mention of global payment giants Visa and Mastercard. They form the bedrock of the payment infrastructure, offering robust, secure networks on which many prepaid card services in Italy and elsewhere are based.

Inforamtion

• Number of pages : 30 pages
• Format : Digital and PDF versions
• Last update : 12/07/2023

Summary and extracts